Instead of hitting it big on Wall Street, emerging companies are hitting the wall.

Late Tuesday, Internet address registrar Go Daddy Group, parent of GoDaddy.com, yanked its initial public stock offering. Just days earlier, Alien Technology, a bar-code tech company geeks have buzzed about for years, pulled out.

They highlight a troubling trend for companies trying to tap the public capital markets. This year, 37 IPOs have been yanked, on track to be the biggest number of withdrawals since 2001, says Richard Peterson, senior researcher at Thomson Financial. It's yet another sign Wall Street suffers from a bad case of IPO indigestion. "The IPO market is in the doldrums," he says. Companies aspiring to be public are seeing their dreams dashed because of:

The tech-packed Nasdaq (NASDAQ) is down 6.6% this year. "We think things will be dismal for a while," Parsons says, adding he is prepared to delay the IPO for years. Go Daddy hoped to go public so it could expand more rapidly and let existing shareholders cash in.

•Poor IPO performance. Investors aren't exactly lining up to buy IPOs, given their performance. IPOs this year, on average, are down 2% from their offering prices, Renaissance Capital says. The uncertain economy has made IPO investors become picky, says Sal Morreale, IPO tracker for Cantor Fitzgerald.

•High-profile IPO blowups. The colossal blowup of Internet phone company Vonage (VG) is scaring IPO investors and IPO hopefuls alike, says Joel Greenberg, partner at law firm Kaye Scholer. Investors that got in at the IPO price got drilled, losing nearly 60%. "Vonage shook people up," he says, though he thinks that profitable firms with more stable businesses can still go public.

•Skepticism over private-equity backed IPOs. Investors are looking askance at companies brought public by private investors who have piled debt onto the companies and use the IPO proceeds to pay themselves a dividend, Gaskins says. With interest rates rising, these deals are riskier, he says.

Morreale thinks more marginal companies, which filed for IPOs when stocks were rising in the spring, will pull out when they see what they face. "As the environment becomes more volatile, people start looking at IPOs through the microscope more," he says.